Mortgage Express has largely triumphed in a deceit action against Countrywide Surveyors (CWS), succeeding in respect of 39 out of 41 claims worth more than £3m.
Judge Behrens, sitting in Leeds, gave his ruling on 10 sample claims, across four different categories of transactions. He ruled thatMortgage Express’s claims succeeded in respect of three of the categories, dismissing its case only in respect of two flats.
Applying that ruling to the full roster of 41 properties, Mortgage Express was successful in respect of 39, which represent a total claimed of £3,150,473. The failed claims were said to be worth only £159,801.
The final quantum of any award, including interest, will be dealt with later if it cannot be agreed.
The judge said: “This is a claim in deceit. Between December 2004 and 24 June 2005, Peter Driver, an employee of CWS, provided valuation reports for 64 properties which were mostly two-bedroom new-build flats located at a new marina development at Macquarie Quay, Sovereign Harbour, Eastbourne.
“In respect of all 64 properties, Mr Driver gave rental valuations of between £1,300 and £1,540 pcm. The opinion of both valuation experts separately instructed byMortgage Express and CWS is that the overall range of retrospective rental valuations was in fact between £600 and £750 pcm. This valuation is now admitted by CWS.
“Mortgage Express claims that it advanced monies between May and December 2005 to borrowers in reliance on the valuations. It contends that the loans would not have been made if it had known the true rental valuations.Mortgage Express claims that it has lost more than £3.3m as a result of lending against the security of 41 of these flats.”
The judge said that losses had crystallised in respect of 41 of the 64 properties
Finding in favour of Mortgage Express in respect of most of those properties, he said: “I am satisfied on the balance of probabilities that Mr Driver had no honest belief in the £1,540 rental figure in the valuations. In my view Mr Driver was at the very least reckless in the sense that he did not care whether it was true or false.”
However, in respect of the two failed claims, he found that Driver’s valuations in respect of those properties “did not have a continuing effect”.
Mortgage Express (an unlimited company) v Countrywide Surveyors Ltd Chancery (Judge Behrens) 12 February 2016
Paul Lowenstein QC and Charlotte Eborall (instructed by Walker Morris LLP) for the claimant
Michael Douglas QC (instructed by DAC Beachcroft LLP) for the defendant
